American Airlines Launching Iceland Service

American just announced a new flight from Dallas Fort-Worth to Reykjavik, Iceland. When I saw the release that American would be going to Iceland I first assumed it would be from Philadelphia, which they consider their primary transatlantic gateway. However Dallas makes a certain amount of sense.

Most Iceland service is from the East Coast already and Dallas will offer better connections from the West.

Wow Air announced Dallas – Iceland already, and Icelandair did as well, so American wants to protect its route network

Wow Air, Copyright: zhukovsky / 123RF Stock Photo

The new flight goes on sale Monday November 20 and will be operated by a Boeing 757 will lie flat (but not direct aisle access) seats. These are the same B/E Aerospace Diamond seats that American uses in their premium transcon A321T business class, and that United will be jettisoning for new Polaris seats.

And like many of American’s Ma href=”http://viewfromthewing.boardingarea.com/2017/08/16/american-will-less-international-flying-jfk-build-philadephia/” target=_blank>new transatlantic route announcements, this one is seasonal — of course no one wants to go to Iceland in the northern winter.

Service dates:

Dallas – Reykjavik, June 7 – October 26
8:20 p.m. – 9:15 a.m.+1

Reykjavik – Dallas, June 8 – October 27
11:10 a.m. – 2:50 p.m.

Without connections beyond Iceland I’d imagine this will be a leisure-heavy route and even with just 16 premium cabin seats it wouldn’t surprise me if upgrades were doable. We’ll see next summer!

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Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002.
Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

AA could still have connections in KEF with a connecting flight on their joint business partner British Airways or Finnair. Iberia Express also has seasonal Madrid service so AA can have connecting service. Plus AA gets all the DFW connections so this will be a winner for AA.

Icelantic deep discount carrier WOW is coming to Dallas-Fort Worth May 24th. WOW flies to Reykjavik, where passengers change on to flights to their destination. WOW will bring major European cities including Frankfurt, London and Paris within their low-price orbit.
PRICE ANNOUNCED – $300 ROUND TRIP
This is great news for Dallas-Fort Worth consumers. A comparison of flights to London gives an example. Currently, DFW appears to be served by two carriers, American Airlines and British Airways. However, they are really just one, as they act in concert and through the Oneworld revenue sharing alliance. Running scans on Google flights I estimate that DFW-London passengers pay roughly twice as much as passengers flying to London from Chicago or New York. WOW has already posted their DFW fares on their web site. $300 round trip. And, if you want to stopover in Iceland for a few days for a side of fetid shark while watching the aurora borealis, its free.
Be aware that WOW is an ‘unbundling’ carrier. The fare gets you there with a personal item, but optional items are priced a la carte. A carry-on bag is $40. A checked bag $60. A reserved seat $14-$16. And a meal is an extra cost item as well (roughly $14). Extra legroom and extra width seats run between $110 and $600. The latter is at least 37″ of extra legroom plus extra width, and is the closest thing to Premium Economy in WOWs single-class cabin. What this amounts to is that you could put together a Premium Economy experience with reserved seats and bags included for less than the price of a base coach American Airlines or British Airways fare.
WOW will be flying the widebody A330-300 into DFW. Consult Seatguru.com for the cabin layout.

This is an interesting development. I assume there is no commercial need for airline service from DFW to Reykjavik — yet alone for 3 airlines to fly the route nonstop. Iceland air service seems like a bubble to me; perhaps not as bad as Cuba service last year, but still pretty bubbly. I’ve been to Iceland, and liked it, but it is not — or at least SHOULD not be — a mass market tourist destination. It’s a good destination for folks who like to self-drive through rugged nature — kind of like a more developed Patagonia — but I honestly don’t know that many people who like that. Reykjavik itself has modest charms, and — like the rest of the country — is obscenely expensive. Given the tiny population (335,000 people on the whole island) the spike in demand from all these new flights will undoubtedly make lodging and other services on the island even more expensive.

What I suspect is going on is that AA sees an opportunity to weaken WOW and Icelandair without doing too much financial damage to itself. The major carriers already seem to have the upper hand in the transatlantic battle against the new low fare airlines — their transatlantic unit revenue is increasing, while the low fare airlines RASMs are declining. So I think AA wants to inflict more pain, in the hope its competitors pull out. I can think of no other reason why AA would launch this flight.

iahphx: WOW and Icelandair are not going to Iceland. They are going to and from Europe. Reykjavik is the hub. It just happens to be in the middle, not on one end or the other. The free stopover is like peanuts – handed out free because it is a likable extra that does not cost much.

@ achalk Yes, but there has to be a percentage of travellers headed to Iceland. Only heavily subsidized Middle Eastern airlines are able to offer service to the USA without any real O/D demand (the business plans of Icelandair and WOW may be flawed, but they’re not being subsidized). The math couldn’t possibly work. And AA wouldn’t be launching this service if they couldn’t hurt WOW and Icelandair by taking away some O/D pax.

iahphx: To understand the model, assume that nobody goes to Iceland. It is just a transit terminal, conveniently on the Great Circle between the US and Europe. It just happens to be in exactly the right place to put the hub in a North Atlantic hub-and-spoke. The entrepreneur behind WOW created it and is quite brilliant to do so. Icelandair are just dotards playing monkey-see, monkey-do. They always have been. American? God knows why, as the high-cost provider, they want to put metal on this route.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel -- a topic he has covered since 2002.

Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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